Dynamic vegetation feedback has been shown to play an important role in climate variability and change, especially in semi-arid regions. This study presents evidence that vegetation dynamics is also an important process in wet tropical climate. Precipitation in most of the Amazon shows multi-decadal fluctuations that were attributed to oceanic forcing in the Atlantic. Using the CAM3-CLM3-DGVM model, this modeling study shows that oceanic forcing alone cannot explain the observed multi-decadal variability of precipitation, and contribution from dynamic vegetation is critical for the model to reproduce the low-frequency variability in the Amazon. Despite the large amount of annual precipitation, the presence of a dry season (albeit short) facilitates a strong impact of dynamic vegetation on precipitation persistence in the model. The year-to-year variation of net primary productivity (NPP) is dominated by that of the dry season NPP. As a result, above-normal (below-normal) precipitation in a particular year can enhance (limit) vegetation growth, leading to widespread increase (decrease) of vegetation density in the subsequent year, which favors (reduces) precipitation. Precipitation in the subsequent year is therefore more likely to be above (below) normal. This damping effect of vegetation is what enhances the low-frequency variability of precipitation in the model.